India’s Emerging Food Security Crisis: The Consequences of the Neoliberal Assault on the Public Distribution System

Analytical Monthly Review, published in Kharagpur, West Bengal, India, is a sister edition of Monthly Review. Its May 2008 issue features the following editorial. — Ed.

Today, but few can recall memories of the Bengal famine of 1943 and 1944. Most disturbingly, after almost two decades of “reform” and a full decade or more of a nonstop media festival of growth rates and India Shining songs and chants, a massive acute food crisis is again a possibility. For the rulers of India such concerns, while now unavoidable, remain highly abstract. The memories of Bengal famine are again of special importance. Ashok Mitra, in his memoir Apila-Chapila (Ananda Publishers, 2003) [in English translation A Prattler’s Tale (SAMYA, 2007)], tells of millions from the countryside dragging themselves to the cities to beg and to die in the streets. “We went to college, stepping over these live corpses, these half-dead men, women and children. It was an appalling situation. Yet the daily lives of the middle and upper classes were largely unaffected.” Those with similar experience were a guiding force in the creation of post-independence food security programs that, for all their faults and inequalities, achieved a significant rise in per capita foodgrain and calorie consumption over the four decades from 1950. This achievement was swiftly wiped out by the period of neoliberal reform. Already by 2004 foodgrain absorption per capita had dropped to the 150 kilograms per year level of 1950-51, a fall of over 20 kilograms from levels achieved by the 1990s.

The consequences of over a decade of neoliberal hunger are what make the current conjunction of global foodgrain price rise and severe weather events, such as the recent Burmese cyclone, the Australian drought, the extraordinarily severe Chinese winter, a matter requiring urgent attention. Famine is not the result of a failed monsoon or other extraordinary extreme shortage that exhausts what under normal circumstances would be abundant food reserves. Even the most efficient historical systems of food stocks, such as that of Ming China, ran into the year that exhausts reserves. Widespread hunger, not famine, is the result. Only when a population has been nutritionally deprived for an extended period does the year of extraordinary shortage become the year of famine. Utsa Patnaik, our leading specialist in the agrarian economy, asserts that — although wartime burdens placed upon India by the British were a primary cause — the Bengal famine was largely the result of “the preceding three decades of declining nutrition in Bengal which had seen a much larger than average drop in per capita foodgrains availability, by nearly 40% between 1911 and 1947.” It is precisely this situation in which we now find ourselves. For most Indians a persistent decline in available calories has marked the neoliberal era. A recent useful study (Ranjan Ray, “Diversity in Calorie Sources and Undernourishment during Rapid Economic Growth,” EPW, 23rd February 2008) used household calorie intake data from recent National Sample Survey rounds and generally accepted minimum gender specific daily calorie requirements for rural and urban populations to compose a “prevalence of undernutrition” index that would permit comparison over time. The percentage of rural Indian households that were undernourished rose from 48% at the time of NSS Round 43 (1987-8) to 67% at NSS Round 57 (2001-2). Undernourished urban households rose from 37% in 1987-8 to 51% in 2001-2. Things have worsened since 2002, as population growth has overwhelmed rapidly declining domestic rates of growth of food production and rural poverty has accelerated. It is this decade of increasing prevalence of malnutrition and hunger that threatens disaster as a result of an emerging food security problem.

The primary defense for food security remains a badly weakened Public Distribution System (PDS). The PDS was developed in the 1960s both to provide food to deficit regions and all strata of the population and to create sufficient effective demand to encourage a growing agricultural production. The PDS took advantage of increased yields of the “green revolution” to fashion a system of subsidies that despite all global price fluctuations guaranteed farmers a price above costs, moved foodgrains from the favored surplus areas of “green revolution” production to deficit areas, and sold foodgrains at a price low enough to ensure adequate offtake. Though always beset with problems, the PDS was at base a success and achieved a substantial increase in per capita consumption of calories. After 1991, intense pressure from the IMF and the World Bank to reduce the budget deficit brought first a sharp rise in the PDS price of foodgrains unmatched by higher prices for farmers, and then the introduction of “Targeted PDS” in 1997. Within ten years all that had been gained over a generation was lost. “Targeting” involved the near-criminal use of indefensible “Poverty Lines” to subject a vast impoverished population to paying prevailing market prices for essentials. Though accompanied by hypocritical expressions of concern for the poor from both World Bank and Indian neoliberals, targeting was a deliberate and successful attack on the PDS system as a whole. As Utsa Patnaik has said:

If one looks at the history of targeting in other countries, it becomes clear that it has always been a prelude to winding up of state intervention in procurement. That has been the ultimate aim of the International Monetary Fund, the World Bank and the World Trade Organisation. They specifically say that the state should not intervene to buy and sell at prices other than global prices. The WTO agreement on agriculture states that for food security purposes, the government can maintain food stocks but then, at the same time, it says that the government cannot offer farmers prices that are higher than global market prices. Global prices are very volatile. The government’s role here is to protect both the farmer and the consumer. The whole rationale of the PDS lies in that. (Interview by TK Rajalakshmi, Frontline April, 2008)

And indeed the targeted PDS has gone a long way to the destruction of the system. According to NSS Report on Public Distribution System and Other Sources Of Household Consumption, 2004-05, 58 per cent of subsidised foodgrains do not reach Below Poverty Line (“BPL”) families, as 22 per cent reach Above Poverty Line (“APL”) families, while 36 per cent are sold in the black market. Only 57 per cent of BPL households have ration cards, while the homeless often do not have any. Only 28 per cent of the rural poor have benefited from any type of government food assistance schemes, and for urban areas the figure is just 9.5 per cent. Over half (51%) of rural households with the smallest landholdings (less than 0.01 hectares) do not possess ration cards that entitle them to monthly rations of rice, wheat, sugar and kerosene under the PDS. See <cseindia.org/programme/nrml/infocus-august07.htm>. A more effective means of “targeting” was Chidambaram’s budget proposal, in long overdue acknowledgement of the desperate agricultural crisis, to forgive bank debt to farmers. Of course the richer farmers have larger outstanding loans and would benefit the most, and the poorest forced to subject themselves to the village usurers would not benefit at all. The neoliberals are not against subsidies that benefit the more prosperous.

This introduction of “free market forces” into food production and distribution has amounted to, in fact, murder. At first, as was inevitable in a market system subjected to strong deflationary pressures from World Bank, IMF and governmental authorities, prices shot down and small farmers lost in sequence their profits, their lands and their lives. Then as world market prices for essential foods shot up — the result of the U.S. exporting its inflation to the rest of the world to finance its aggression in Iraq and the U.S. provision of vast subsidies to turn foodgrains into fuel — masses living in hunger are driven to the verge of starvation while foodgrains they cannot afford to buy accumulate in the warehouses. We know that no long-term solution is possible absent revolutionary land reform, but neoliberal policies have brought the nation to the point where the vagaries of climate could produce famine not experienced in two generations. This desperate situation demands the immediate abolition of targeting and the introduction of universal PDS with an effective system for public supervision.

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